Khobragade then filed a motion to dismiss the charges, claiming she was "cloaked in diplomatic immunity at the time of her arrest," according to the motion.

The court agreed, stating that Khobragade was "appointed a Counselor to the Permanent Mission of India to the United Nations, a position that cloaked her with full diplomatic immunity," according to court documents. She was appointed to that position on January 8, a day before she was indicted.

"Even if Khobragade had no immunity at the time of her arrest and has none now, her acquisition of immunity during the pendency of proceedings mandates dismissal," U.S. District Judge Shira Scheindlin wrote.

James Margolin, spokesman for the United States Attorney's Office for the Southern District of New York, did not rule out the possibility of further charges.

"As the court indicated in its decision, and as Devyani Khobragade has conceded, there is currently no bar to a new indictment against her for her alleged criminal conduct, and we intend to proceed accordingly," he said in a statement.

Khobragade, who left the United States in January, is now working for the Indian Ministry of External Affairs in Delhi.

Her case drew international attention, with Indian officials demanding apologies from Washington, and the United States announcing it would withdraw one official from its embassy in New Delhi.